Wi-Fi News Briefs

• Don't Worry, Be Happy
• A Wi-Fi VPN First?
• Getting Better All The Time

by Gerry Blackwell [May 8, 2001]

Don't Worry, Be Happy
While high-profile bankruptcies by wireless CLECs, such as Winstar and Advanced Radio Telecom, have cast doubt on the future of fixed wireless broadband access in the U.S., there is still great potential for success, according to a new study from The Strategis Group.

The report, U.S. Fixed Wireless Markets, says that from a relatively low base in 2001, broadband wireless service revenues will climb to $6.3 billion by 2005—representing a five-year total of more than $17 billion and compound annual growth of almost 60 percent.

"It's inevitable that troubles at Winstar and Teligent—as the most visible players in the market—would reflect poorly on the whole industry," notes Peter Jarich, director of global broadband research at Strategis.

"The problem is that the spectrum they use, LMDS, is only one aspect of U.S. fixed wireless. On the MMDS side, Sprint and WorldCom continue to make news and the unlicensed spectrum space just saw a major operator, Clearwire, pull in almost $100 million in new funding."

And LMDS and LMDS-based carriers won't be going away anytime soon either, Strategis says. Driven by new operators, new technologies and an installed base of networks, millimeter-wave is expected to maintain its prominence, accounting for almost half of broadband wireless revenues in 2005.

Many 28 GHz and 39 GHz licensees are still just preparing to launch networks and, at the same time, operators like E-Xpedient are shaking things up by using unlicensed 60 GHz networks to offer service at low prices.

According to Jarich, "regardless of the past few months, there is still good reason to be bullish on the LMDS sector."

The Strategis Group, a C7 company with offices in Washington, DC, London, Singapore, and São Paulo, publishes market research reports, provides customized consulting services and supplies continuous information services on broadband, wireless, cable TV, satellite, Internet and competitive telephony industries.

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A Wi-Fi VPN First?
AIR2LAN Inc., a broadband wireless services company based in Jackson MS, completed the first phase of an innovative wireless network for the City of Ridgeland in Mississippi. The network connects five municipal facilities and will save the city an estimated $10,000 a month in wireline connection costs.

The broadband Virtual Private Network (VPN) provides each location with high-speed access to the Internet and to data on the city's network server. The network operates securely over Internet Protocol (IP), allowing the city's technical staff to administer the network securely from virtually anywhere.

The second phase of the project, which will connect two additional facilities, is scheduled to be completed in July.

AIR2LAN added VPN Solutions to its offerings earlier this year. The City of Ridgeland project is the company's first large-scale implementation of the technology. A VPN provides a company, municipality or other organization with a cost-effective means of connecting employees in various locations to a single network, the company says.

"Setting up this sort of network with wireless connections was a good solution for the city," says AIR2LAN chairman and CEO Jai P. Bhagat.

"They had three goals: get a lot of bandwidth to each location, connect the locations into a network and do it cost-effectively. We were able to accomplish all of those."

The project is believed to be one of the country's first wireless municipal VPNs. The city considered wireline connections such as frame relay and fiber optic lines, but cost was a primary consideration.

"This wireless network allows us to serve our citizens in a very cost-conscious and productive way," says Ridgeland mayor Gene McGee. "We have already seen significant improvements in communications among employees and departments."

In addition to high-speed Internet access and access to the city's data, the wireless network will provide city employees with e-mail and access to accounting and other software applications.

"The use of a wireless VPN is a cost-effective way to network our different departments for file-sharing, e-mail and other applications," says the network administrator Clyde Graham. "I'm able to log into the network securely from just about anywhere."

Graham even logged into and administered the network remotely during a recent trip to the Middle East.

The City of Ridgeland network operates within AIR2LAN's citywide wireless network. AIR2LAN transmits from one of its antenna sites to a transceiver on the roof of each of the city facilities.

AIR2LAN provides a range of broadband services, including high-speed wireless access from 128 Kbps to 4.5 Mbps, Web design, Web hosting, e-commerce, network security and VPN solutions.

The company provides wireless connectivity via license-exempt spectrum using equipment from Wi-LAN Inc.

It currently offers services in Jackson, Houston, New Orleans, Montgomery AL and Baton Rouge LA. AIR2LAN has also announced plans to deploy five additional markets in 2001 and grow to 40 markets by the end of 2003.

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Getting Better All The Time
Two more suppliers of fixed wireless equipment that operate in license-exempt bands have announced first quarter results that show they're moving in the right direction.

BreezeCOM of Tel Aviv, Israel and Carlsbad CA announced revenues for the first quarter ended March 31, 2001 of $23.9 million. That's an increase of 53 per cent compared with revenues of $15.6 million for the same period in 2000.

Net income for the first quarter was $63,000, compared with a net loss of $256,000 in the first quarter last year. The diluted earnings per share was nil, compared to a loss of a penny per share in the same period in 2000.

"Although we were affected by the abrupt downturn in the U.S. market, our ongoing geographic diversification efforts continued to help us by lowering our dependence on U.S. sales," says BreezeCOM president and CEO Zvi Slonimsky.

"While U.S. market conditions were difficult, our sales in Europe, Latin America and Southeast Asia went according to our business plan. In these regions, we have continued to successfully deploy 3.5GHz, unlicensed and MMDS networks."

Meanwhile, SPEEDCOM Wireless Corp. of Sarasota FL announced record results for the quarter ending March 31, 2001.

Revenues for the first quarter of 2001 were $4.02 million, an increase of 118% compared to $1.85 million in the first quarter of 2000, and an increase of 15.5% over the $3.48 million posted in the fourth quarter of 2000.

Net loss for the first quarter of 2001, including non-cash charges, was $1,169,553 or 13 cents a share, compared to a net losses of $1,300,185 or 14 cents per share in the fourth quarter of 2000.

The only downside is that the first quarter loss is higher than the $178,176 or two cents per share posted in the first quarter of 2000.

"We are pleased to once again report record revenues to our shareholders. Our growth, especially internationally, remains strong," says SPEEDCOM president Bruce Sanguinetti.

"We believe that our fixed wireless broadband products are achieving increasing levels of acceptance worldwide as an alternative to expensive, and often unavailable DSL, cable or T-1 lines."

"SPEEDCOM's backlog remains solid, and our existing projects continue toward full deployment. The strong results reflect our position as a leader in the fast-growing fixed wireless broadband market."

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